Organisational reward strategies and performance of front line managers: analysis of Pakistani textile industry

Abstract

The current study seeks to contribute specifically to the literature on reward management and managerial performance. In doing so, it aims to address certain gaps in the existing literature; particularly a noticeable lack of research in rewards and individual performance relationships in a developing country, Pakistan. This study has sought to examine the relationship of extrinsic rewards comprising of pay, bonuses, opportunities for promotion and intrinsic rewards such as sense of recognition, job characteristics with individual performance measured as task and contextual performance including citizenship behaviour. Furthermore, the study has sought to examine the mediation role of organisational justice elements such as procedural and distributive justice in reward performance relationships. The study aims at identifying different rewards being offered in textile organisations and their relationships with performance of front line managers in textile sector organisations. The study focuses primarily on key research questions: 1. What is the relationship between extrinsic rewards such as pay and bonus based incentives with the performance of front line managers? 2. How do opportunities for promotion relate with performance of front line managers in textile industry? 3. What is the relationship of intrinsic rewards such as sense of recognition and job characteristics with the performance of front line managers? 4. How does procedural and distributive justice influence the reward performance relationships for front line managers in textile industry? Being deductive in nature, the current study revolves around the premises of positivist philosophy. Being cross section in nature, a survey based design is selected and a quantitative strategy is used in this study for data collection and analysis. The study is facilitated by random stratified sampling for data collection and structural equation modelling technique to draw results of direct and mediation effects of study constructs. The results portray significant relationships of rewards and individual performance with relatively strong emphasis on task performance in comparison to contextual performance. The results further highlight the mediation of procedural and distributive justice particularly in extrinsic rewards and task performance relationships for front line managers. The study seeks to contribute to existing theoretical knowledge and practices in developing economies and is pioneering in its examination of rewards-individual performance relationships in Pakistan. In examining organisational rewards with task and contextual performance for front line managers in private manufacturing sector, the study tends to address the gap in existing literature on reward and performance management. Moreover, the current study further seeks to examine the mediation effects of procedural and distributive justice in reward performance relationships discovering this field of theoretical knowledge as existing literature does not reflect upon this gap. The study intends to offer help and support to concerned stakeholders in better understanding, developing and modifying rewards-performance relationships particularly for textile industry in Pakistan.